Quarter of Coverage

Latest amount & QC explanation
The amount of earnings required for a quarter of coverage (QC) in 2015 is
$1,220. "Quarter of coverage" is a
legal term,
but you may also see the term "Social Security credit" (or just "credit") used
elsewhere. A QC is the basic unit for determining whether a worker is
insured under the Social Security program.
No matter how high your earnings may be, you can not earn more than 4 QC's in
one year.

For years before 1978, an individual generally was credited with a quarter of
coverage for each quarter in which wages of $50 or more were paid, or an
individual was credited with 4 quarters of coverage for every taxable year in
which $400 or more of self-employment income was earned. Beginning in 1978,
employers generally report wages on an annual, instead of quarterly, basis.
With this change to annual reporting, the law provided that a quarter of
coverage be credited for each $250 of an individual's total wages and
self-employment income for calendar year 1978 (up to a maximum of 4 quarters
of coverage for the year). After 1978, the amount of earnings needed for a
quarter of coverage changes automatically each year with changes in the
national average wage index.

Determination of the quarter of coverage amount for 2015
The law specifies that the quarter of coverage (QC) amount for 2015 is
equal to the 1978 amount of $250 multiplied by the ratio of the
national average wage index for 2013 to that for
1976, or, if larger, the 2014 amount of $1,200. If the amount so
determined is not a multiple of $10, it shall be rounded to the nearest
multiple of $10.

Calculation details

Amounts informula

1978 earnings for one QC

$250

1976 average wage index

9,226.48

2013 average wage index

44,888.16

Computation

$250 times 44,888.16 divided by 9,226.48
equals $1,216.29, which rounds to $1,220

Higher amount

$1,220 exceeds the amount for 2014,
so the earnings needed to earn one QC in 2015 is $1,220

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